Under Boris Johnson’s plan to hike National Insurance by 1.25% as part of social care reform, a care worker on the minimum wage will receive a tax rise but not a pay rise, Sir Keir Starmer has said.
The Labour leader said the prime minister’s reforms to social care mean 2.5 million families will now face the “double whammy” of a National Insurance rise and a cut in Universal Credit payments following the scrapping of the £20 uplift.
“Why is the prime minister insisting on hammering working people?” he questioned.
But the PM accused Sir Keir of having “no plan” to fix the problems within the social care sector and the NHS backlog.
He added that the Institute for Fiscal Studies has deemed the rise in National Insurance payments as a “progressive measure”.
Facing each other in person in the Commons at PMQs for the first time since social distancing restrictions have been relaxed, Sir Keir used all of his six questions to discuss the PM’s new plan for social care which was revealed on Tuesday.
“Under his plan, a landlord renting out dozens of properties won’t pay a penny more, but their tenants in work will face tax rises of hundreds of pounds a year,” the Labour leader said.
“A care worker earning the minimum wage doesn’t get a pay rise under this plan, but does get a tax rise.
“In what world is that fair?”
The PM replied: “Actually the Institute for Fiscal Studies has confirmed that it is a broad based and progressive measure.
“The top 20% of households by income will pay forty times what the poorest 20% pay.
“The top 40% pay half of the entire levy.”
Later, when asked by Sir Keir if his plan will clear the NHS waiting list backlog “by the end of this parliament”, Mr Johnson replied: “We at least have a plan to fix the backlogs.”
He added: “Vote Labour, wait longer.”
Elsewhere in the pair’s exchanges, the PM did not explicitly answer whether the government’s reforms will clear the NHS backlog or will result in nobody having to sell their home to fund their care.
And Sir Keir did not directly answer multiple questions from the PM on whether he would vote in favour of the proposed National Insurance increase.
A spokesman for the Labour leader later confirmed the party would vote against the health and social care tax rise.
“The reason why we’re voting against the proposals is because they don’t fix social care, they won’t clear the backlog and it’s an unfair tax rise,” the spokesman said.
On Tuesday, Mr Johnson announced that National Insurance contributions will rise by 1.25 percentage points to pay for the social care system in England in a bid to end the “unpredictable and catastrophic costs” faced by many.
A social care package, which the prime minister has called “the biggest catch-up programme” in the NHS’s history, will be funded through a new, UK-wide “health and social care levy” from April 2022.
MPs will vote on the biggest tax rise for decades to fund the NHS and social care reforms later on Wednesday.
The government is confident it will win the vote, but concerns remain both about how the £12bn will be raised and how much of it will be directed towards the care sector.
Meanwhile, Liberal Democrat leader Ed Davey accused the PM of “forgetting family carers” in his plan for social care.
Sir Ed, who is a carer for his son, accused Mr Johnson of “taking us for granted”.
“Yesterday’s social care plan forgot family carers, yet we are the millions wiping bottoms, washing and dressing our loved ones, whether they are elderly or disabled, ill or dying,” the Lib Dem leader said.
“We carers just want a fair deal. So will the prime minister raise carers’ allowance? Will he guarantee proper breaks for carers? Will he change employment law so we can balance caring with work? And will he ensure there are enough professional carers to help – starting with a new visa for carers?”
Mr Johnson replied: “I think the whole House acknowledges the massive debt we owe to unpaid carers up and down the country. We thank them for what they are doing.
“What this plan does is, of course, mean that there will be a huge injection of support both in the private sector and from the government into caring across the board.
“I believe that will support unpaid carers as well since they will no longer have the anxiety, for instance, that their elderly loved ones could see the loss of all their possessions.”
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